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Globalizing Inequality: ‘Centrifugal’ and ‘Centripetal’ Forces at Work

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  • José Gabriel Palma

Abstract

This paper reassesses national income inequalities in this era of globalization. The main conclusion is that two opposite forces are at work: one ‘centrifugal’ at the two extremes of the distribution—increasing the disparity of income shares appropriated by the top and by the bottom four deciles across countries; and the other ‘centripetal’ in the middle—increasing the uniformity of the share of income going to deciles 5 to 9. Therefore, globalization is creating a situation where virtually all the intercountry diversity of income distribution is the result of differences in what the rich and the poor get in each country.

Suggested Citation

  • José Gabriel Palma, 2006. "Globalizing Inequality: ‘Centrifugal’ and ‘Centripetal’ Forces at Work," Working Papers 35, United Nations, Department of Economics and Social Affairs.
  • Handle: RePEc:une:wpaper:35
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    File URL: http://www.un.org/esa/desa/papers/2006/wp35_2006.pdf
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    References listed on IDEAS

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    1. Atkinson, A B, 1997. "Bringing Income Distribution in from the Cold," Economic Journal, Royal Economic Society, vol. 107(441), pages 297-321, March.
    2. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-591, September.
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    6. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, World Bank Group, vol. 10(3), pages 565-591, September.
    7. Paul Krugman & Robert Lawrence, 1993. "Trade, Jobs, and Wages," NBER Working Papers 4478, National Bureau of Economic Research, Inc.
    8. Deepak Lal, 1993. "Poverty and Development," UCLA Economics Working Papers 707, UCLA Department of Economics.
    9. Jonathan E. Haskel, 1999. "The Trade and Labour Approaches to Wage Inequality," Working Papers 405, Queen Mary University of London, School of Economics and Finance.
    10. William R. Cline, 1997. "Trade and Income Distribution," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 58.
    11. José Gabriel Palma, 2005. "The seven main "stylized facts" of the Mexican economy since trade liberalization and NAFTA," Industrial and Corporate Change, Oxford University Press, vol. 14(6), pages 941-991, December.
    12. Jonathan Michie (ed.), 2003. "The Handbook of Globalisation," Books, Edward Elgar Publishing, number 2964.
    13. Jonathan E. Haskel, 1999. "The Trade and Labour Approaches to Wage Inequality," Working Papers 405, Queen Mary University of London, School of Economics and Finance.
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    Citations

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    Cited by:

    1. Amanda Lenhardt & Andrew Shepherd, 2013. "What has happened to the poorest 50%?," Global Development Institute Working Paper Series 18413, GDI, The University of Manchester.
    2. Milanovic, Branko & Ersado, Lire, 2008. "Reform and Inequality during the Transition: An Analysis Using Panel Household Survey Data, 1990-2005," Policy Research Working Paper Series 4780, The World Bank.
    3. Alex Cobham & Luke Schlogl & Andy Sumner, 2015. "Inequality and the Tails: The Palma Proposition and Ratio Revisited," Working Papers 143, United Nations, Department of Economics and Social Affairs.
    4. Narasimha Rao, 2014. "International and intranational equity in sharing climate change mitigation burdens," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 14(2), pages 129-146, May.
    5. Greselin, Francesca & Zitikis, Ricardas, 2015. "Measuring economic inequality and risk: a unifying approach based on personal gambles, societal preferences and references," MPRA Paper 65892, University Library of Munich, Germany.
    6. repec:gam:jecnmx:v:6:y:2018:i:1:p:4-:d:128699 is not listed on IDEAS
    7. Andy Sumner, 2016. "The world's two new middles Growth, precarity, structural change, and the limitations of the special case," WIDER Working Paper Series 034, World Institute for Development Economic Research (UNU-WIDER).
    8. Costanza Consolandi & Giampaolo Gabbi & Massimo Matthias & Pietro Vozzella, 2013. "The Italian Financial System," FESSUD studies fstudy12, Financialisation, Economy, Society & Sustainable Development (FESSUD) Project.
    9. Alex Cobham, Andy Sumner, 2013. "Is It All About the Tails? The Palma Measure of Income Inequality-Working Paper 343," Working Papers 343, Center for Global Development.
    10. Alex Cobham & Lukas Schlögl & Andy Sumner, 2016. "Inequality and the Tails: the Palma Proposition and Ratio," Global Policy, London School of Economics and Political Science, vol. 7(1), pages 25-36, February.
    11. Alex Cobham & Andrew Sumner, 2013. "Is it all about the tails? The Palma measure of income inequality," Working Papers 308, ECINEQ, Society for the Study of Economic Inequality.

    More about this item

    Keywords

    economic development; structural change; comparative studies; development policy;

    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • F - International Economics
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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